Killer Arguments Against LVT, Not (196)

David Curry, who was a Tory MP until 2010, is a moderate LVT-supporter and has written a couple of articles in fairly obscure journals, such as this one in ROOF in 2007, which is mainly about s106 Agreements:

The discreet charms of the dear old section 106 agreements are now being aired... An alternative idea is for a flat rate levy to be applied per building: this has been trialled in Milton Keynes but it is difficult to draw too many conclusions from the exceptional circumstances of a new town.

But the real mystery is why Brown did not go for the really bold option: not a tax on land when it was coming into development but a tax when it wasn’t. In other words, a land value tax. This concept has some very distinguished proponents, including Martin Wolf of the FT and some American cities have picked up the idea. It would have sparked a much more constructive debate than the predictable discussion about planning gain.

Perhaps I have an inkling of the difficulty: if someone invited me to attack the idea of a land value tax I would reach for that most potent political weapon – the indignant pensioner! Imagine the granny, asset rich because of a property she bought 40 years earlier but cash poor. Then explain that she owes the government a sum with a bunch of noughts behind it because of the value of the land attached to her house – and take cover.

I don't get it.

Can't politicians just preface each article or speech on LVT by simply saying that "Pensioners' sole and main residences will be exempt, of course" and have done with it? It's a foul compromise, but one well worth making.
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We know for a fact that politicians love dreaming up subsidies and meddling left, right and centre in the tax and welfare systems, which are largely 'man made', there is little or nothing by way of underlying philosophy or overarching vision, there are huge overlaps (double taxation), things which cancel themselves out* and lacunas (where the anti-avoidance provision to prevent abuse of a tax-break which morphs into a loophole itself causes further distortions ad infinitum).

We then end up with a tax system that looks like this (photo from Dumplinginahanky), bearing in mind that's just the legislation (in nine point type on thin paper), the guide books are twice as long again, and the legislation and guidance for the welfare system is twice as voluminous as that for the tax system:We could slim all this down to about five pages of legislation, and tack on a section at the end saying that pensioners' sole and main residences are exempt from LVT, job done.

* As evidence, the Lib Dems are making a big show of wanting to increase the income-tax/NIC free personal allowance to £10,000.

Do these morons not realise that the income tax/NIC-free personal allowance for a single earner already is £10,000? That happens to be the income level at which the PAYE deducted (plus Employer's NIC) and the Working Tax Credits net off to A Big Fat Zero. You can check the PAYE here and the WTC here, or just use the tax/benefits spreadsheets in my 'quick links' widget.